- XAU/USD lost more than 0.60%, falling to the $1,925 area.
- The US DXY index rose to its highest level since March.
- The cautious market mood amid the fragile Chinese situation may limit Gold’s downside.
In Tuesday’s session, the XAU/USD sharply declined, as the USD showed strong gains during the session, and the spot price closed at $1,925.
In that sense, the USD, measured by the DXY index, rose more than 0.50% to its highest level since March, around 104.80, while US bond yields, often seen as the opportunity cost of holding hold, saw more than 1% increases with the 2, 5 and 10-year bond rates rising to 4.96%,4.37% and 4.26%. That yield increase could be explained by Christopher Waller from the Federal Reserve (Fed) flirting with an additional hike, stating that it won’t cause a recession.
On a positive note, investors are closely monitoring the Chinese economic situation, as data on Tuesday showed that service activity fell to its lowest level in eight months, and the fear of a global economic downturn may limit the downside for the yellow metal.
XAU/USD Levels to watch
Based on the daily chart, XAU/USD maintains a neutral to bearish technical perspective, suggesting that the bears are gradually gaining momentum but are not yet in total control. The Relative Strength Index (RSI) points south above its middle point, while the Moving Average Convergence (MACD) histogram shows decreasing green bars.
Support levels: $1,915 (20 and 200-day SMA convergence), $1,900, $1,890.
Resistance levels: $1,930, $1,950, $1,970.
XAU/USD Daily Chart
-638295477185249020.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays pressured below 1.0850 on France's hung parliament
EUR/USD is under pressure below 1.0850 early Monday, dented by the French election results which suggest a hung parliament and renewed fiscal concerns. A broad US Dollar rebound also weighs on the pair. French political updates and EU Sentix data eyed.
GBP/USD steadies around 1.2800 amid modest recovery of US Dollar
GBP/USD keeps its range at around 1.2800 in early European trading on Monday. The US Dollar recovery drags the pair lower while traders remain wary after the UK elections and ahead of Powell's testimony and US CPI data due later this week.
Gold price edges lower as PBoC keeps Gold buying on hold
Gold price attracts some sellers below the $2,400 barrier on Monday. Yellow metal loses traction as China's Central Bank has stopped buying for the second month in June.
Bitcoin falls below $55,000 level
Bitcoin dropped below $56,552 on Sunday, disrupting market structure and signaling a bearish outlook. Ethereum and Ripple also revisited their support levels, slipping below critical thresholds.
French election: It’s all over for Marine Le Pen, but the left weighs on the Euro
The deciding vote in the French Parliamentary elections closed this evening, and the exit poll suggests a shock result. The winning party is the left alliance, the popular front, which was pulled together to try and keep Le Pen’s far right National Rally party out of power.